NTCIC Awarded $40 million in New Markets Tax Credit Allocation

Written By: NTCIC

NTCIC has been awarded a $40 million New Markets Tax Credit (NMTC) allocation by the CDFI Fund of the U.S. Treasury  to support community development projects in low-income areas throughout the U.S. NTCIC will use its allocation to help finance the rehabilitation of vacant or underutilized historic buildings to bring jobs, tax revenue, goods and services to low-income neighborhoods.

The NMTC program provides significant incentives for investments in traditionally hard-to-finance projects. Over a period of seven years, the program rewards investors with tax credits totaling 39 percent of the total financing for select projects in qualified communities. The Department of Treasury has awarded $3.6 billion to 70 organizations nationwide under the 2011 NMTC program. NTCIC was selected from an unprecedented pool of 314 applicants who applied for more than $26.7 billion in NMTCs.

The New Markets Tax Credit and the Historic Tax Credit (HTC) are natural allies. Low-income communities are defined as U.S. census tracts with at least a 20 percent poverty rate or household median incomes at or below 80 percent of the area or statewide median, whichever is greater. 40 percent of all U.S. and most central business district census tracts qualify for the NMTCs. Because most older buildings are found in disinvested parts of cities and towns, and most HTC projects are located in central business districts, historically 68 percent of all HTC Part 3 approvals were granted to properties in qualified NMTC census tracts. NTCIC has been awarded $383 million in New Markets Tax Credit allocations since 2003. To learn more about the types of projects NTCIC has invested in and their  impacts on communities, please click here.